Is the future of traditional broadband in jeopardy?

Thursday, December 13, 2018

The verdict is in – and copper-based broadband in New Zealand has a firm expiration date. The Commerce Commission this week announced that it is seeking feedback on a proposal that will govern Chorus’ withdrawal of copper-based internet services.

Legal changes passed earlier this month mean that from 1 January 2020 Chorus will be able to stop offering voice and broadband services over copper lines in areas where Ultrafast Broadband (UFB) is available. The current feedback is to ensure that consumer safeguards are in place and that consumers will not be disadvantaged by the changes.

What do the changes mean for Broadband Compare Customers? Gavin Male, Founder and CEO of Broadband Compare explains, “Well, if you live in an area where fibre is installed, from 1 January 2020 you may have no choice but to use fibre. There are lots of advantages to fibre broadband, it is much quicker and more reliable than copper-based ADSL and VDSL services. We are already seeing more and more clients switch to a fibre. But, currently around 8% of customers who switch with Broadband Compare and had fibre available to them chose not to subscribe to it. This is the group that could be forced to switch from 1 January 2020. “

Male continues, “The government’s latest progress report on the rollout of UFB indicates that 1,399,236 households and businesses have access to ultra-fast broadband (UFB), and 668,850, or 47.8%, have already connected. That means that 52.2% who could sign up to UFB haven’t yet – that’s over 730,000 people across New Zealand missing out on the multitude of benefits that fibre broadband offers.”

These changes broadly mean that the prices for Fibre Broadband plans are expected to reduce, and copper-based ADSL and VDSL plans are likely to increase in price as less people use the service and maintenance becomes more expensive. In fact, to further drive the move to fibre, Chorus recently announced that they will cut the price of their wholesale Gigabit ultra-fast broadband (UFB) service.

Gavin Male says, “This is a great time for consumers to evaluate their current broadband plan and find out how much they could save by switching plan or provider. We are seeing a trend toward lower priced Fibre Broadband plans. We are currently working with one of our partners to bring Kiwi consumers unlimited fibre broadband at just $59.99 per month on a 12 month contract. However, if you live in an area where fibre is not yet available, there are still some great deals on the copper network with capped ADSL plans starting at $54.95 per month. With price increases likely on the copper network it might be prudent to sign a new 12 or 24 month contract where the price is fixed for the duration.”

Broadband Compare is also investing in services to support their customers through this changing landscape and help to answer questions from consumers.

“Our quarterly NZ consumer research report, Broadband Pulse, indicates that whilst a wide range of age groups are shopping around for new broadband plans, people aged 25-44 are likely to switch straight away and those aged 44 and over are likely to take more time and prefer to do more research first. That is why we established, and are expanding, our call centre at 0508 226 672. If you need help looking at the options in your area, or help to ease your transition to fibre, there is a friendly Broadband Compare team member ready to speak with you.”